Both the audit reports and the recent media reports have shown that there is a huge degree of negligence from the side of the banks, in the case of the misappropriation case of MMPRC.
Auditor General’s report stated that there were over 60 cheques, amounting to around US$ 65 million, were deposited to MMPRC account, contravening the board resolution. The report also stated that the cheques were deposited with the signature of one individual, instead of two, and deposited to private accounts. The report urged the relevant bodies to investigate the case.
Auditor General said that the bank procedures on endorsed cheques were seriously lacking in security measures. The report further said that while a state owned company was engaging in acts that are clearly committing actions that are akin to money laundering the said banks were wholly unaware of the situation and if they had knowledge had not raised awareness on the issue.
The report recommended to introduce more regulatory measures by the relevant bodies in order to prevent such issues occurring again.
A statement released by Maldives Monetary Authority (MMA), the responsible agency on financial agencies, said that the Authority will take action against complicit banks, in light of the MMPRC audit. The statement also said that the agency was concerned over the serious issues in the financial sector in the country.
MMA added that they were researching on current procedures and aspects noted in the report. The statement also said that if there were any issues noted in this review, appropriate action will be taken against those bank. The statement assured that all possible measures will be implemented to strengthen the banking sector.
The need for stronger banking regulations has become apparent over the years, given the high number of fraud and other similar cases. Auditor General’s report had clearly stated the MMPRC embezzlement was carried out with the assistance of the banks.